- Ethereum saw a strong and grave selloff overnight that drove its price down to lows of $585
- This is around the price at which the cryptocurrency was able to find some strong support that gave rise to it forming what has since resulted in a “V-shaped” recovery
- Where it trends in the mid-term should depend largely on the follow-through of this recovery, as a strong rebound from here could confirm that these lows will mark a long-term bottom
- Any rejection at $620 – which has been a resistance level over the past few days – could temper its technical strength
- One analyst is now noting that the overnight decline put the crypto in a precarious position, with ETH almost invalidating its bull trend
Ethereum and Bitcoin have both seen some rocky price action as of late, but ETH seems to be more subjected to seeing drastic moves lower, with traders clearly viewing it as a higher beta asset.
Overnight, this caused it to decline below $600, reaching lows of $585 before bulls stepped up and put an end to the selloff.
In the time since it has recovered virtually all of its losses and is now targeting a break above its $620 resistance.
One analyst noted that the overnight decline had placed Ethereum is a precarious position, but this no longer seems to be a concern.
Ethereum Recovers from Sharp Overnight Selloff
At the time of writing, Ethereum is trading up just under 2% at its current price of $617. This is around the price at which it has been trading over the past few days.
Overnight, its price plunged as low as $585 before buyers stepped in and slowed its descent. This strength does seem to indicate that further upside could be imminent in the days ahead.
It faces some resistance at $620 that could prove difficult for it to surmount in the near-term.
Trader Claims ETH Nearly Invalidated Its Bull Trend
One prominent analyst explained in a tweet during the massive Ethereum selloff that the cryptocurrency’s bull trend was close to being overdue to the intensity of the decline.
The fact that bulls rapidly pushed its price higher almost instantly after the break below $600 occurred indicates that they are still in firm control of its price action.
“4h ETH: bad news: bull trend over… good news: next entry should be fairly obvious,” he said while pointing to the below chart.
Image Courtesy of Josh Olszewicz. Source: ETHUSD on TradingView.
Bitcoin is still guiding the market, making its near-term price action vital for Ethereum and other major altcoins.
Featured image from Unsplash. Charts from TradingView.